Plummeting vegetable prices: Farmers in distress

In the past calendar year, vegetable production was disrupted due to prolonged droughts, followed by floods and excessive rainfall. As a result, prices soared abnormally. However, thanks to the relentless efforts of farmers, production has reached an expected level. Now, it is the peak season for vegetables, and markets are filled with an abundance of winter vegetables. Vendors have set up stalls showcasing a diverse array of vegetables, and supply is increasing daily. Consequently, vegetable prices are gradually declining, making them affordable for consumers.

Currently, a cauliflower costs between 15 and 20 taka. Hyacinth beans (shim) are priced at 20 to 25 taka per kilogram, while bitter gourd (korola) costs between 50 and 60 taka per kilogram. Radish is selling at 10 to 15 taka per kilogram, while a bottle gourd (lau) is priced at 25 to 30 taka. The price of tomatoes has dropped to 20 taka per kilogram, and green chilies are selling at 40 taka per kilogram. Just a month ago, these prices were more than double due to a supply shortage. Now, a price decline has occurred, and at the farm level, the prices are even less than half of the market rates.

Farmers complain that they are unable to recover their production costs from the sale of vegetables. Such fluctuations in price hikes and declines are frequently observed. Therefore, it is essential to have detailed data and analysis regarding this issue. We need to examine the production costs of various vegetables, their average selling prices, and the profits earned by farmers. This information will help both farmers and consumers remain patient during seasonal price fluctuations. Moreover, it will allow them to understand the fairness of vegetable prices.

The Bangladesh Agricultural Research Council recently conducted a study on the production costs of various crops, their farm-gate prices, profitability, and international competitiveness. A major partner in this research was the Bangladesh Agricultural Research Institute. The institute’s agricultural economics department has been conducting surveys on vegetable production costs and profits. Their findings indicate that vegetable production is profitable, but farm-level earnings remain low. This is because transportation costs, marketing expenses, intermediaries' profits, and financial losses due to perishability are factored into the retail price. Vegetables are highly perishable, with a wastage rate of around 30 percent. As a result, retail prices are significantly higher than farm-gate prices.

During off-seasons, vegetable prices tend to rise sharply, causing distress among consumers. Conversely, during peak production seasons, consumers enjoy affordable prices, but farmers face difficulties due to lower returns.

For the past three years, consumers have been struggling with the high price of onions. The production cost per kilogram is approximately 22 taka, while the average farm-gate price is around 30 taka, yielding a profit of about 8 taka per kilogram. Considering a 25-30 percent wastage at the retail level, the maximum reasonable price should be around 50-55 taka per kilogram. Even when imported from the international market, the average price of onions stands at approximately the same range.

However, the continuous price surges of onions, with prices hitting 100 and even 200 taka per kilogram in consecutive years, are alarming. Similarly, the sharp rise in potato prices over the past two years is also noteworthy. Based on production costs, storage, and marketing expenses, the maximum fair price for potatoes should have been 35-40 taka per kilogram. Even with imports, the average price should not exceed this range. However, during the last off-season, consumers had to pay 70-80 taka per kilogram.
This is a management issue, exacerbated by market manipulation. A syndicate of traders has been actively inflating prices for excessive profit. The government's intervention to counteract this manipulation was insufficient, prolonging the crisis and causing consumers to suffer. Now, with the peak season for onions and potatoes, farm-gate prices have dropped significantly, leading to losses for farmers.
Potatoes are classified as staple crops, while onions are spice crops. However, both are also considered vegetables. Due to lower production compared to demand, import uncertainties, unscrupulous traders’ manipulations, and supply shortages, the prices of these two essential commodities often skyrocket. The gap between retail prices and justifiable prices remains significantly high.

In times of price instability, both farmers and consumers can benefit from knowing the production costs and the government-determined fair prices of commodities. The fair price of a product is determined at different stages of the supply chain by adding farmers' profits, intermediary marketing costs, and business margins to the production cost. For imported goods, the fair price is set by adding internal distribution costs and profit margins to the import price.

When market supply is low, retail prices often exceed the fair price. Conversely, during the peak production season, market supply increases, and retail prices can drop below the fair price. During off-seasons, when prices are high, many people emphasize fair pricing, but when prices plummet during peak production, discussions about fair pricing are notably absent.

Currently, vegetable prices in the market have fallen drastically, in some cases well below fair price levels, causing significant losses for farmers. For example, the production cost of cauliflower and cabbage this year is around 10 taka per kilogram. Adding a minimum 20% profit, the fair farm-gate price should be at least 12 taka per kilogram. However, rural farmers are struggling to get even 5 taka per kilogram.

A post on the Facebook page Krishoker Krishi Bhubon (which has 1.815 million members) highlighted this crisis. Farmer Md. Sakil Khan commented, "The year 2025 will go down in history as the year of losses for farmers. Onion, potato, eggplant, cauliflower—every product has left farmers in despair." In some cases, frustrated farmers are seen destroying their radishes and cabbages in the fields with machetes due to the collapse in prices.

This phenomenon is not unique to Bangladesh; farm produce prices tend to drop during peak production seasons in many countries. However, nowhere else do prices crash to such extreme lows, nor is farmers' distress as deeply felt as it is in Bangladesh.

A status posted on the Facebook page Krishoker Pran Krishi Poribar on January 20 by farmer Hedayetul Islam reads, "From now on, I will cultivate only as much as I need for personal use. I will no longer engage in commercial farming. Let us unite, brothers."

Many university students in Bangladesh have studied the cobweb theory in economics, which explains that when the price of a product rises, production increases in the following season, leading to a price drop. Consequently, production decreases in the next season, creating a cyclical effect.

Bangladesh cultivates around 95 types of vegetables, with 30-35 being considered major varieties. According to the Department of Agricultural Extension (DAE), the total vegetable cultivation area in the 2023-24 fiscal year was 1.16 million hectares, yielding an annual production of 24.17 million tons. Based on this, the daily per capita vegetable availability stands at 389 grams.

However, according to data from the Bangladesh Bureau of Statistics (BBS), the actual daily per capita vegetable consumption is 202 grams (HIES 2022). This significant discrepancy between the two sources raises questions about data accuracy and interpretation.

Once, vegetable production in Bangladesh was mostly concentrated in the winter season, while summer cultivation was relatively low. However, vegetable farming has now expanded in both seasons. Thirty years ago, there was little awareness about summer cultivation of tomatoes, cauliflower, cabbage, and onions in the country. Today, due to advancements in agricultural research, this has become a reality.
Currently, about 60% of total vegetable production occurs in winter, while the remaining 40% is grown in the summer. Some of the major winter vegetables include cauliflower, cabbage, kohlrabi, carrots, lettuce, spinach, broccoli, turnips, tomatoes, radishes, bottle gourd, eggplant, and hyacinth beans. Summer vegetables include okra, pointed gourd, pumpkin, teasel gourd, snake gourd, ridge gourd, stem amaranth, red amaranth, Malabar spinach, bitter gourd, and cucumber. Additionally, certain vegetables are grown year-round, such as eggplant, taro, papaya, green bananas, and drumsticks.

Bangladesh has also become a significant exporter of vegetables, with both the quantity and revenue from exports increasing over the years. In 1993-94, the country exported 8,422 tons of vegetables, earning $9.44 million. Fifteen years later, in 2008-09, vegetable exports reached 22,791 tons, generating $44.67 million in revenue. By the 2020-21 fiscal year, exports had nearly doubled to 45,545 tons, bringing in approximately $118.73 million. However, in the 2023-24 fiscal year, exports slightly declined, resulting in earnings of $112.47 million.

Currently, Bangladesh exports fruits and vegetables to 35 countries worldwide. Some of the notable destinations include the United Kingdom, Saudi Arabia, Kuwait, Qatar, the United Arab Emirates, Bahrain, Italy, and 28 other countries. Vegetable production in Middle Eastern countries is costly, making imports from Bangladesh a more viable option. This presents a strong potential for expanding Bangladeshi vegetable exports in international markets. However, ensuring a consistent supply of high-quality vegetables that meet foreign market demands is crucial. To achieve this, quality vegetable production, proper post-harvest management, and effective storage facilities are essential.

Additionally, ensuring sufficient cargo space for vegetable exports and reducing transportation costs, particularly for air freight, can help increase export volumes. Diplomatic efforts are also necessary to expand Bangladesh’s vegetable market abroad. Recently, organic vegetable cultivation has gained traction in Bangladesh. These products are in high demand internationally and are also becoming popular domestically. To promote safe vegetable marketing, a Farmers’ Market has been introduced in Dhaka, increasing the demand for organic vegetables. Bangladeshi embassies abroad can play a vital role in marketing these products. For successful market expansion, exporters must be regularly informed about foreign market trends and pricing.

Vegetables are becoming increasingly popular as food due to growing public awareness of their nutritional benefits. They are rich in vitamins and minerals, including vitamin A, vitamin C, protein, calcium, and iron. Vegetables contain essential micronutrients that are not visible but are crucial for health. A deficiency in these nutrients can weaken children's immune systems, hinder physical growth, and cause diseases such as night blindness (due to vitamin A deficiency), goiter (due to iodine deficiency), and anemia (due to iron deficiency).

Moreover, vegetables aid in the absorption of protein-rich foods and enhance digestive system functions. Since they are low in fat and carbohydrates, they help in weight management. Additionally, their lack of cholesterol reduces the risk of heart disease and high blood pressure. Some vegetables also contain phytochemicals that help prevent tumors and other diseases.

Vegetable consumption is highly effective in addressing malnutrition. However, ensuring the safety of vegetables is essential. The use of toxic chemicals in vegetable production must be kept within safe limits, and organic farming should be encouraged. The vegetable food value chain must be kept free from infectious contaminants, and contaminated water should be avoided when washing vegetables. Expanding cold storage facilities and "cold chain transportation systems" will help deliver safe vegetables from producers to consumers.

To ensure food safety, Good Agricultural Practices (GAP) must be followed during pre-production, production, and post-harvest processing. The production and processing environments should be improved to supply high-quality vegetables to consumers.

Currently, contract-based vegetable farming is being practiced in different regions of the country. Many educated young entrepreneurs have ventured into vegetable farming, selling their produce at fair prices. These vegetables are being supplied to major supermarkets and exported abroad. This initiative should be encouraged through policy and financial support to increase the production of high-quality vegetables. Such measures will boost export earnings and allow domestic consumers to purchase vegetables at fair prices. This will ensure food security, promote nutritious vegetable consumption, and help resolve malnutrition issues in the country.

Dr. Jahangir Alam: Agricultural Economist, Researcher, and Educator. Former Vice-Chancellor, University of Global Village. Former Director General, Bangladesh Livestock Research Institute.